Codes of practice and service charters

Codes of practice and service charters are guidelines for fair dealing between you and your customers. What they do is let your customers know what you as a business agree to do when dealing with them. Sometimes they relate to a single business. At other times they can represent a whole industry.

Codes of Practice and Service Charters can assure customers that your business is trading fairly and ethically. NSW Fair Trading has already endorsed several voluntary codes of practice developed in consultation with different industry groups. These codes have resulted in better customer/trader relations by establishing agreed minimum standards of behaviour and conduct for handling various trading situations.

Codes of practice

Usually, codes of practice are put together through consultation with representatives of a specific industry and the community. They can be mandatory or voluntary. Mandatory codes provide a minimum standard of protection to the consumers of particular industries. They are prescribed as regulations under the Fair Trading Act 1987 (Part 7) and have the force of law.

Voluntary codes are a form of industry self-regulation. They can be sponsored by a particular industry association or they may be in partnership with a government agency. Membership of an industry association may be a condition of the code.

Unlike mandatory codes, voluntary industry codes are flexible and can be altered quickly in response to changing industry/consumer needs. Compliance with a voluntary code can give you a competitive edge in the marketplace. Usually this is promoted through the display of an industry-endorsed logo that customers should look for.

Service charters

Service charters, on the other hand, are usually created on a business by business basis and give certain guarantees to customers about the service levels that they can expect and what will happen if they are not met. Areas identified in service charters are those of importance to customers.

If you decide to adopt a service charter or a code of practice, the most important thing to remember is that they are active documents. In other words, customers and the government expect you to live by the code or charter and not to simply launch it and forget about it. The code or charter is your written promise to the world about how your business deals with customers, not just a vague motto.